Japan, China and India

China Takes over Free Trade leadership

As the western democracies turn inward, looking to erect wals, reduce immigration and increase protectionism the Asian world is moving in the opposite direction. The mult decade bull markets in these areas have a long way to run despite recent losses. Currently China is negotiating two free trade agreements, they will span the whole of the Asian region allowing those countries to grow their stock maret valuations in the way the West has over the last ten years. As the west's markets look like topping the east looks prmed for growth.

Asian Stockmarkets January Forecast

Shanghai

No change No trade

Nikkei 225

This was the big winning trade for December 2016, the compass was perfect leading to an excellent low risk high profit trade. The image shows the trade in green and the compass forecast in black. The next step is not clear so I will move to the sidelines.

Nifty

I have had tomake a change to the compass, the Nifty did not cross the red trigger line (hence no trade) and has since traded lower suggesting wave 2 is not yet complete. I have moved the wave two target down to 63% a common pullback target. The plan for the trade remains unchanged

The Asian Giants December Forecast

Shanghai Composite

I count a 5 wave advance from 1995 followed by a 3 wave correction. The bull market seems to have re started with wave 1 complete followed by a pull back which may also be complete. A close above 3685 would increase the probability of this count being correct and suggest a long trade.

Nikkei 225

The Nikkei is now in wave 3 of a 5 wave advance from the 2009 low. Wave 2 shown as WXYXZ retraced just over 38% of the advance breking through the top of the pattern and retracing on Trump night. The Asian stock markets are well below their all time highs and now have fundamentals in their favour. This wave should make the previous high of 21000.

Nifty 50

The Nifty appears to be in the final wave of its bull market begining in 2009. The final wave will break into 5 smaller waves, when it breaks the red line we can be sure the third wave has begun and will buy at that point. The recent turmoil in India caused by its currency removal will likely mark the end of wave 2. It is very common for political and economic events to mark the end of a wave.

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